US CPI Annualised (Aug):

The tension here is between the backward-looking aggregates and the run-rate: the 12-month rate is drifting lower on base effects while the 3-month annualised pace has re-accelerated, and in past episodes of this kind the annualised 3-month measure has been the number front-end pricing keys on, since it is the closest proxy for the trend the Fed claims to be watching. The core annualised figure sits well above target-consistent territory, a gap that has historically kept easing cycles shallow or delayed their start when the short-run rates were also firming. The usual sequence is that the short end re-prices first on the run-rate surprise, with the long end following only to the extent the persistence narrative shifts, and curve flattening has been the established pattern when the beat lands mid-cutting-cycle. Worth watching is the composition detail when the full tables circulate, since a re-acceleration concentrated in shelter has tended to be discounted as lagged, while breadth across services ex-housing has been the tell that moved officials' rhetoric. The next labour print now carries more weight, as it is the release that has historically arbitrated between inflation caution and employment concern inside the committee.